FD interview: A secure future?

Trevor Dighton racked up a lot of air miles in a variety of roles before finding himself CFO of Group 4 Securicor and, as he tells Jenny Hirschkorn, the journey isn't over yet.

When Trevor Dighton left school, he had a stated ambition never to work in an office. Aged just 16, he racked up four years' experience as, among other things, a grave-digger, a waiter and a window cleaner.

'It was the 1960s,' he tells me not once, but twice, as if to deride the idea that anyone who came of age in the era of flower power, free love and the Mersey beat could possibly have contemplated becoming part of the establishment.

So it would have been a reckless gambler indeed who would have bet on his becoming finance director of arguably the world's number one security company, yet here he is, 40 years on, in the finance role at Group 4 Securicor, having been one of the driving forces behind last year's merger between two of the best known names in the security business.

By the age of 20 and with the 1960s drawing to a close, Dighton realised that he would have to change tack if he was going to make any progress in his working life, so he shrugged off the mantle of casual labourer and enrolled for a course in business studies. It was there that he began to take an interest in accountancy. With a couple of modules under his belt, he joined a small electronics components company in order to complete his CIMA qualification.

Mines a large one

He may have settled for an office-based profession, but he had no intention of settling for just any old office. No sooner had he qualified than he applied to work for Anglo American, which owned the copper mines in Zambia.

'I didn't know what job I was getting when I went there: they were just recruiting anyone with an accountancy qualification.'

When he arrived in Africa, in spite of the fact that he was a commercial accountant, he was put into internal audit. 'It was great,' he recalls, 'very varied. The copper mines effectively owned Zambia: all the hospitals, the clubs and the football clubs. All the community stuff was owned by Anglo American. This meant I might be auditing the taverns one day and working on a complex process-costing audit the next. It also meant getting around Zambia quite a bit as the copper mines were all over the place.'

On his return to the UK after three years, he joined Deloitte. 'I think an important part of any accountancy training is to work in the profession, even if you are commercially trained.' But his wanderlust got the better of him, and after four years he set off once more for distant shores.

This time it was Papua New Guinea.

'Deloitte wasn't in there, so I went with KPMG,' he declares, as if being determined to go to Papua New Guinea were the most natural thing in the world. 'Why Papua New Guinea?' I ask.

'We (he and his wife, Joanna) wanted to go to another developing country.

We'd been to Africa and in South America the language would have been an issue. We were thinking that Australia might be a permanent place for us to settle, so the South Pacific seemed the ideal option.'

Less than six months after his arrival there KPMG pulled out of the country.

Dighton, though, stayed on for another four-and-a-half years, first rescuing Douglas Airways from failure, then turning around Word Publishing, a media company owned by the church.

In safe hands

His first taste of the security industry came back in the UK when he became finance director of BET's Security & Communications Division, but when that company was swallowed up by Rentokil it became clear that he had no future there.

And so, 10 years ago, Dighton applied for the job as FD of the vehicles division of Securicor, which was then a collection of very diverse businesses.

It used, for example, to own 40% of Cellnet, had a large parcels business and was heavily involved in the communications industry. The result was that, although the security business was at the company's core, it had been dwarfed by its other interests.

Before long, Dighton moved over to the security division, from where he oversaw the rationalisation of the company's activities. 'It was a combination of trimming off the bits that we no longer wanted and expanding the bits we wanted to concentrate on,' he says.

By the time he was appointed Securicor's group finance director three years ago the transformation was well under way and, in the three or four years leading up to the merger, the security business effectively trebled in size. The industry was ripe for consolidation of some of the major players and, for Securicor, a merger seemed like the obvious next step.

So just how did the union with Denmark's Group 4 Falck come to fruition?

'It had been a possibility for some time and, of course, we at Securicor knew the other companies in the marketplace very well. In this case, the two organisations were a particularly good fit. The first meeting we had was in July 2003, but initially there was not much activity. There was just the odd gentle meeting to get used to the idea, but from December we got down to some nitty gritty discussions, and then the deal was announced in February.'

Although the merger was completed in just five months, there were a few hiccups along the way, mainly in the form of competition issues raised by the European Commission relating to three territories. It was a hurdle Dighton and his co-directors did not expect to have to negotiate. 'We knew that there would be a problem with Luxembourg,' he explains, 'because both businesses were virtually identical in size and in most of the markets, so we knew we had to get rid of one of them.

'The other two weren't so obvious. The cash services business in Scotland we thought was so small that we thought it wouldn't really make any impact.

It was making a loss and Group 4 had been trying to get out of it for some time and it seemed a natural progression for us to take that on board.

But there was an insistence that we sell it.'

But the one that really hurt was Holland. 'That was not anticipated because our combined market share was still quite small and we had figures that showed that there was still a good competitive position in Holland. But that didn't satisfy the Commission.' Although it was convinced it was right, Securicor stood down and agreed in order to stop the case moving from Phase I to Phase II, which, at best, would slow the whole process down and, at worst, might scupper it altogether.

'It was an awful experience really, because you can't run a business while it is being sold. The management is transferred to trustees and you can't have any input in what they are doing. The value has deteriorated considerably.'

Those issues aside, the integration was completed significantly ahead of schedule and the newly formed group is now the largest security company in the world in terms of employee numbers and countries of operation, although it just lags behind Sweden's Securitas in turnover.

It operates in four main business areas. Some 60% of turnover comes from the manned guarding service which supplies guards to customers including governments, public authorities, commercial companies and retailers. The security systems division encompasses the design, installation, maintenance and monitoring of intruder alarms, CCTV and other security systems. The cash services business provides cash transportation, coin and cash management, ATM management and replenishment and fully-outsourced cash centre management.

Finally, there is justice services, which includes the custody and rehabilitation of prisoners, electronic tagging and monitoring of offenders, prisoner escorting and immigration services.

Escaping criticism

It is this last division that is the most high profile and controversial, because the public have been reluctant to accept the privatisation of these functions. Who cannot remember, for example, the gloating of the press when Group 4 were involved in a series of security blunders in the 1990s? But Dighton is swift to defend these initiatives. 'There are some people who will never see this in a positive light because they are opposed to the privatisation of these services. But it really is much more efficient from an economic point of view. And the criticism Group 4 got wasn't really justified as it lost far fewer prisoners than the prison service had done.'

With the merger complete, Dighton will have more time on his hands. Much of it he expects to spend on the acquisition trail, something he never ceases to find challenging. 'They don't just fall off trees. You have to search them out. It is much easier to go ahead with a bad acquisition than to walk away from it. It's quite a skill.' He's likely to be particularly keen to spend some of his £400m budget to enter new markets in Brazil, Mexico, Spain, Portugal and Australia. 'It's not about putting flags in maps,' he is keen to point out. 'It is of great benefit to the whole organisation to have global coverage.'

So what about Dighton's own global coverage? Has the fact that he is now based in Crawley, barely 20 miles from his birthplace in Croydon, put an end to his globe-trotting days? Not a bit of it. 'I probably spend about a quarter of my time abroad. You can't run an effective business without getting out on the ground and seeing how things operate. It's absolutely essential. We operate in 110 countries and I reckon I've been to half of them.'

CV

Who: Trevor Dighton

When: 30 July 1949

Where: Croydon, Surrey

Qualifications: CIMA

Work: Assistant chief internal auditor, Anglo American; audit manager, Coopers & Lybrand; manager, KPMG; chief executive, Douglas Airways; chief executive, Word Publishing Co; divisional finance director, BET plc; various roles at Securicor, culminating in CFO, Group 4 Securicor

Life: Rugby (he supports the Northampton Saints); music, especially blues.

GROUP 4 SECURICOR FACTS

•    On 20 July 2004 Group 4 Securicor shares began trading on the London and Copenhagen stock exchanges.

•    The company has over 360,000 employees in 110 countries on six continents.

•    In July 2005 the enlarged group's Danish chief executive, Lars Norby Johansen, handed over the reins earlier than expected to his deputy, Nick Buckles.

•    The group's 2004 pro forma turnover was £3.8bn, with EBITA of £216.5m.

•    In 2002 Group 4 Falck entered the US security market by acquiring the Wackenhut Corporation, the second largest security services company in the US.

•    The group is likely to be a beneficiary of the contracts being awarded by the London Olympics Committee.

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